Three consecutive strong down days, each opening within the previous body and closing near its low. Sustained selling across three sessions rather than one bad day.
Each candle should have a substantial real body and a short lower wick, showing sellers held their ground into every close. Each open should sit inside the previous body — a series of gaps down is a different and usually more panicked thing.
After an advance or an extended flat stretch, it is among the more convincing bearish formations, because three days of consistent supply is difficult to produce by accident.
Compare the bodies. Roughly equal sizes suggest steady distribution; each one shrinking suggests the selling is already exhausting itself.
The main risk is arriving late. After three heavy days a stock is frequently oversold, and the pattern often marks a short-term bounce point rather than the start of a decline.
During market-wide corrections it appears across most of the index at once and says nothing about any individual company.
Shrinking bodies with lengthening lower wicks across the three days signal exhaustion rather than continuation — often the last leg of a fall rather than the first.